Yellow dished out $4.6M in bonuses to its top execs weeks before declaring bankruptcy. Over half of the sum was for retention bonuses as the company contemplated liquidating.
Though it’s unclear how the company landed on the hefty sums, which offset severance payments totaling about $306,000 and $296,000, the person told Fortune.Such handouts are commonly granted during major restructurings as an incentive for employees to stay and help their failing employer.
Former Yellow customers and shippers may face higher prices as they take their business to competitors, including FedEx or ABF Freight, experts say — noting Yellow historically offered the cheapest price points in the industry. Yellow Chief Restructuring Officer Matthew Doheny was among the failing company’s executives to receive the largest retention bonus — $1 million.Though Yellow’s bankruptcy was sudden, it didn’t come as a shock to the industry.
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